First Economic Espionage Trial Begins In US

SANTA ANA, Calif. (AP) A Chinese-born engineer stole trade secrets critical to the U.S. space program and passed them to China for three decades without detection, prosecutors said Tuesday in the first economic espionage case to reach trial in the United States.

Prosecutors laid out their case against Dongfan "Greg" Chung, 73, in U.S. District Court in Santa Ana. The Chinese-born engineer has pleaded not guilty to charges of conspiracy, economic espionage, lying to federal agents, obstruction of justice and acting as a foreign agent.

In his opening statement, Assistant U.S. Attorney Greg Staples said Chung, 73, gained the trust of Boeing Co. and his previous employer, Rockwell International, and used his job as a stress analyst at the companies to steal more than 250,000 pages of sensitive documents.

The documents included trade secrets on a phased array antenna for the U.S. space shuttle and on the Delta IV booster rocket, according to government allegations.

"Information, security and betrayal: These are the three pillars of the government's case," he said. "Boeing builds things, but the crucial point in this case is, nothing gets built without information, the kind of information we're talking about."

"You can call it God or you can call it the devil, but it is success that is in the details and it is the details that the government is going to show the defendant had in his house and collected for the PRC (People's Republic of China)," he said. "The details are the difference between getting into space and ending up with a plaything for children in a park."

Staples said that in come cases the alleged information theft involved processes that seem mundane, such as documents on how to solder metal so it can withstand space travel.

"This seems trivial but it's not. Millions of lives depend on, 'Did you do the right job soldering?"' Staples said.

Defense attorney Tom Bienert countered that the government would not be able to prove his client had done anything wrong, particularly after 2003, which is when the defense believes the statute of limitations expired.

He also downplayed the importance of what Chung allegedly took for the Chinese.

"There simply will be no evidence that my client transferred any information to the People's Republic of China ... much less anything that would be a trade secret," Bienert said.

Bienert also showed the judge pictures of his client's house with papers and books on every available surface, stacked on the floor and overflowing the bathtub. He said that explained why FBI agents found a quarter-million pages of Boeing documents there.

"What you're going to find is that my client is a pack rat," he said. "With all respect to my client, his house gives new meaning to clutter."

Six similar cases have settled before trial since the Economic Espionage Act passed in 1996.

Chung worked for Rockwell International until it was bought by Boeing in 1996 and remained with the aerospace giant until he was laid off in 2002. He was brought back as a consultant on stress analysis after the Columbia space shuttle disaster in 2003 and was fired when the FBI began its probe in 2006.

The government believes Chung began spying for the Chinese in the late 1970s, just a few years after he became a U.S. citizen and was hired by Rockwell.

In a letter cited in court documents, Chung allegedly explains to a Chinese contact that he sent three sets of volumes dealing with flight stress analysis to China via sea freight and discusses what prosecutors say is his motive.

"Having been a Chinese compatriot for over thirty years and being proud of the achievements by the people's efforts for the motherland, I am regretful for not contributing anything," according to the letter to the contact at the Harbin Institute of Technology in northern China. "I would like to make an effort to contribute to the Four Modernizations of China."

Prosecutors say they discovered Chung's activities while investigating the case of another suspected Chinese spy, Chi Mak. Searches of Mak's house turned up an address book and a letter containing Chung's name.

Mak was convicted in 2007 of conspiracy to export U.S. defense technology to China and sentenced to more than 24 years in prison. Mak, however, was not charged under the Economic Espionage Act.